Siena is a guard-gated, age-qualified community situated in the Summerlin master planned community in Las Vegas, Nevada. Like many exclusive neighborhoods, this 667-acre project, still under development by the Sunrise Colony Co., is packed with amenities including an 18-hole golf course nested among what eventually will be 2,000 semi-custom and estate homes priced from $140,000 to $650,000.

What makes Siena different is how Sunrise Colony is opting to finance its golf course. Instead of the traditional country club approach, in which residents are expected to purchase an equity membership, Sunrise Colony opted to make the Siena golf course and club house an amenity within the community, but own and operate the golf course independently relying on daily course fees to fund it.

The daily fee strategy is a departure from the developer's standard operating procedure, says Julie Knepp, vice president of marketing for Sunrise Colony.

Like many country club community builders have discovered, Sunrise Colony concluded that golf isn't going to drive this development. After a careful market analysis of the buyer demographic, Sunrise Colony found that only about 20 percent of the Siena homeowners will play the game.

“They like the idea of golf, but they're not necessarily golfers,” Knepp says. “It's a much different philosophy in terms of how we view golf.”

That percentage was too small to support an equity club, but at the same time, was small enough to offer those who do golf a significant discount on greens fees without negatively impacting the course's profit margins.

NEW APPROACH: Sunrise Colony relies on daily fees to fund the golf course and club house at Siena, a 667-acre project in Las Vegas. “If you do have more than 20 percent of people who golf, you can lose money,” says Knepp. “It's always a balancing project.”

Gauging Membership The percentage of homeowners who buy golf memberships in a community is “a very telling statistic,” says Knepp, and drives when the course and club can be turned over to the residents. In Sunrise Colony's typical community, 60 percent of the homeowners purchase golf memberships and eventually take over its ownership and operation. The optimum number of memberships per course is about 350, she says, but even that can be high. At Sunrise Colony's Toscana Country Club in Indian Wells, Calif., the two 18-hole Jack Nicklaus courses are limited to 275 members each.

“The higher the membership numbers are, the sooner you can do that,” she says.

Toscana is an equity club from the outset, with the members paying initiation fees that start at $110,000. The process alleviates any concern that the developer might some day sell the club.

“What happens to the course when the developer leaves is a big fear,” Knepp says. “Some developers try to do an equity conversion and sell it to an outside vendor. We always give the members the option to buy it before we'd sell it.”

At Siena, the homeowner's association will own all the facilities in the community except the course and the clubhouse, which Sunrise Colony will retain and manage. Residents will get the lowest rates for daily play on the course.

By contrast, residents at Red Rock Country Club, another Sunrise Colony community in Las Vegas, will have access to two courses—one private non-equity course, and one daily fee, both designed by Arnold Palmer.

“There, we don't give residents a discounted rate,” Knepp says. “If they're golfing that much, we want them to join the private club.”

Amenity Focus Following the industry axiom to not let residents go more than one summer without a swimming pool, Siena opened a 15,900-square-foot health and fitness club by the end of 2000, just 13 months after the first residents moved in. Sunrise Colony also has placed heavy marketing emphasis on the state-of-the-art health club with four tennis courts, an indoor lap pool and spa, an outdoor resort pool and spa, a wellness center, a beauty salon, a day spa, and bocce and horseshoe courts, all of which are exclusively for the use of Siena residents. A full-time activities director coordinates a steady stream of classes, special events, and outings.

“That's always been our philosophy,” Knepp says. “Even though we have great courses, we always build a sports club with great work-out facilities and spa facilities. Tennis and the social parts of the membership are really important.

“We have a beauty shop at Siena. We keep [services] close to them. If it's a primary community, we have all kinds of kids programs. In membership communities, we have an event director planning things all the time. At active adult, we have a coordinator to keep everyone busy. That we don't see as much in traditional communities right now.”

The final piece of the Siena amenities package opened in Oct. 2003. The 39,000-square-foot community center features a grand ballroom, computer labs, billiards, a library, and rooms for arts and crafts, sewing, music, and cards.

Marketing to potential golf community customers requires a different approach than selling to the average new home buyer, Knepp says.

“When you're talking golf communities, those people are a little harder to reach with a traditional marketing program,” she says. “You need a wide array of products. Direct mail is good—we have a really broad based campaign. We did TV in Las Vegas. There's nothing better than TV to create an emotional connection. We're the only gated active-adult community in Las Vegas and we wanted to push the private, intimate feeling. That you can show a little bit better on film.”

The marketing message for Siena focuses heavily on the country club experience, which holds value for active-adult buyers even if they don't play golf. Direct mail and print advertising focuses on the lifestyle. Television advertising has been successful in depicting vibrant active adults in an intimate, private community.

“Product is secondary,” Knepp says. “People will come and shop everybody. As long as you have quality floor plans, people are looking for a place to connect where there's a sense of community.”

Knepp echoed the sentiments of other golf community builders when she stressed the importance of selecting the right course designer to achieve the project's sales and marketing objectives.

“The designer can have a lot to do with the success,” she says. “We've worked with Palmer, Nicklaus, and others. If you have a good golf base, people know designers. They know Jack Nicklaus does great courses. Also, the promotional value is tremendous.”

To be sure, appearances by the course designer, either for clinics or charity tournaments, can be phenomenally powerful in driving sales.

Siena's guard-gated entry also plays a major role in the community's marketing, Knepp says. “What we try to do is provide a retreat away from the rest of your world,” she says. “You're greeted, you've arrived, you belong here.”

Learn more about markets featured in this article: Las Vegas, NV.